AMERIPRISE FINANCIAL INC

Previous wording

Ameriprise Financial is a diversified financial services company with a 130-year history of providing financial solutions. We are a long-standing leader in financial planning and advice with $1.4 trillion in assets under management and administration as of June 30, 2024. We offer a broad range of products and services designed to achieve individual and institutional clients’ financial objectives.

Current wording

Ameriprise Financial is a diversified financial services company with a 130-year history of providing financial solutions. We are a long-standing leader in financial planning and advice with $1.5 trillion in assets under management and administration as of September 30, 2024. We offer a broad range of products and services designed to achieve individual and institutional clients’ financial objectives.

Previous wording

While our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), management believes that adjusted operating earnings measures, which exclude net realized investment gains or losses, net of reinsurance accrual; the market impact on non-traditional long-duration products (including variable and fixed deferred annuity contracts and universal life (“UL”) insurance contracts), net of hedges and the reinsurance accrual; mean reversion related impacts (the impact on variable universal life (“VUL”) products for the difference between assumed and updated separate account investment performance on the reinsurance accrual and additional insurance benefit reserves); the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments; block transfer reinsurance transaction impact; gain or loss on disposal of a business that is not considered discontinued operations; integration and restructuring charges; income (loss) from discontinued operations; and the impact of consolidating CIEs, best reflect the underlying performance of our core operations and facilitate a more meaningful trend analysis.

Current wording

While our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), management believes that adjusted operating earnings measures, which exclude net realized investment gains or losses, net of reinsurance accrual; the market impact on non-traditional long-duration products (including variable and fixed deferred annuity contracts and universal life (“UL”) insurance contracts), net of hedges and the reinsurance accrual; mean reversion related impacts (the impact on variable universal life (“VUL”) products for the difference between assumed and updated separate account investment performance on the reinsurance accrual and additional insurance benefit reserves); the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments; block transfer reinsurance transaction impact; gain or loss on disposal of a business that is not considered discontinued operations; integration and restructuring charges; income (loss) from

Previous wording

Total AUM increased $100.7 billion, or 10%, to $1.1 trillion as of June 30, 2024 compared to $1.0 trillion as of June 30, 2023 due to an $80.0 billion increase in Advice & Wealth Management AUM driven by equity market appreciation and wrap account net inflows, and a $25.3 billion increase in Asset Management AUM primarily driven by equity market appreciation, partially offset by net outflows. Total AUA increased $50.4 billion, or 20%, to $298.4 billion as of June 30, 2024 compared to the prior year period primarily driven by equity market appreciation and an increase in third-party money market funds and brokered CDs. See our segment results of operations discussion below for additional information on changes in our AUM.

Current wording

Total AUM increased $201.5 billion, or 20%, to $1.2 trillion as of September 30, 2024 compared to $990.4 billion as of September 30, 2023 due to an $124.5 billion increase in Advice & Wealth Management AUM driven by equity market appreciation and wrap account net inflows, and a $84.9 billion increase in Asset Management AUM primarily driven by equity market appreciation, partially offset by net outflows. Total AUA increased $71.8 billion, or 30%, to $314.2 billion as of September 30, 2024 compared to the prior year period primarily driven by equity market appreciation and an increase in third-party money market funds and brokered CDs. See our segment results of operations discussion below for additional information on changes in our AUM.

Previous wording

Pretax income decreased $76 million, or 7%, for the three months ended June 30, 2024 compared to the prior year period. The following impacts were significant drivers of the period-over-period change in pretax income:

Current wording

Pretax income decreased $472 million, or 42%, for the three months ended September 30, 2024 compared to the prior year period. The following impacts were significant drivers of the period-over-period change in pretax income:

Previous wording

•The market impact on non-traditional long duration products (including variable and fixed deferred annuity contracts and UL insurance contracts), net of hedges and the reinsurance accrual was an expense of $60 million for the three months ended June 30, 2024 compared to a benefit of $127 million for the prior year period.

Current wording

•The market impact on non-traditional long duration products (including variable and fixed deferred annuity contracts and UL insurance contracts), net of hedges and the reinsurance accrual was an expense of $402 million for the three months ended September 30, 2024 compared to a benefit of $211 million for the prior year period.

Previous wording

•A favorable impact from the trend in rising interest rates on the investment portfolio yield, along with higher balances in bank, certificate and structured variable annuities (“SVA”) products.

Current wording

•A favorable impact from the trend in rising investment portfolio yields, along with higher balances in Ameriprise Bank, FSB (“Ameriprise Bank”) customer deposits and structured variable annuities (“SVA”) products.

Previous wording

•A favorable impact from higher average equity markets compared to the prior year period. Our average WEI, which is a proxy for equity movements on AUM, increased 21% in the three months ended June 30, 2024 compared to the prior year period. The average S&P 500 index was 25% higher in the quarter compared to the prior year period.

Current wording

•A favorable impact from higher average equity markets compared to the prior year period. Our average WEI, which is a proxy for equity movements on AUM, increased 22% in the three months ended September 30, 2024 compared to the prior year period. The average S&P 500 index was 24% higher in the quarter compared to the prior year period.

Previous wording

Management and financial advice fees increased $257 million, or 12%, for the three months ended June 30, 2024 compared to the prior year period reflecting market appreciation and wrap account net inflows, partially offset by the cumulative impact of Asset Management net outflows.

Current wording

Management and financial advice fees increased $286 million, or 13%, for the three months ended September 30, 2024 compared to the prior year period reflecting market appreciation and wrap account net inflows, partially offset by the cumulative impact of Asset Management net outflows.

Previous wording

Distribution fees increased $23 million, or 5%, for the three months ended June 30, 2024 compared to the prior year period primarily due to higher transactional activity and market appreciation, partially offset by $44 million of lower fees on off-balance sheet brokerage cash due to lower off-balance sheet brokerage cash balances.

Current wording

Distribution fees increased $50 million, or 11%, for the three months ended September 30, 2024 compared to the prior year period primarily due to higher transactional activity and market appreciation, partially offset by $26 million of lower fees on off-balance sheet brokerage cash.

Previous wording

•The favorable impact of growth in Ameriprise Bank, FSB (“Ameriprise Bank”) customer deposits and certificate business as a result of the market environment.

Current wording

•The favorable impact of growth in Ameriprise Bank customer deposits and SVA products.

Previous wording

Banking and deposit interest expense increased $117 million, or 50%, for the six months ended June 30, 2024 compared to the prior year period primarily reflecting higher average crediting rates and higher average volumes on certificates and Ameriprise Bank cash deposits.

Current wording

Banking and deposit interest expense increased $12 million, or 8%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting higher average crediting rates on certificates and Ameriprise Bank cash deposits.

Previous wording

Distribution expenses increased $202 million, or 16%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting higher market appreciation and higher transactional activity.

Current wording

Distribution expenses increased $242 million, or 19%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting higher market appreciation and higher transactional activity.

Previous wording

Interest credited to fixed accounts increased $24 million, or 15%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting the following items:

Current wording

Interest credited to fixed accounts decreased $21 million, or 15%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting the following items:

Previous wording

•A $19 million decrease in expense from other market impacts on IUL benefits, net of hedges, which was an expense of $12 million for the six months ended June 30, 2024 compared to an expense of $31 million for the prior year period. The decrease in expense was primarily due to an increase in the IUL embedded derivative in the prior period, which reflected less discounting due to lower Treasury rates and higher option costs due to a higher new money rate.

Current wording

•A $20 million decrease in expense from other market impacts on indexed universal life (“IUL”) benefits, net of hedges, which was a benefit of $35 million for the three months ended September 30, 2024 compared to a benefit of $15 million for the prior year period. The decrease in expense was primarily due to a decrease in the IUL embedded derivative in the current period, which reflected model changes and lower option costs due to a lower new money rate, offset by less discounting due to lower Treasury rates.

Previous wording

•A $27 million decrease in expense from the unhedged nonperformance credit spread risk adjustment on IUL benefits. The favorable impact of the nonperformance credit spread was $5 million for the three months ended June 30, 2024 compared to an unfavorable impact of $22 million for the prior year period.

Current wording

•A $3 million increase in expense from the unhedged nonperformance credit spread risk adjustment on IUL benefits. The unfavorable impact of the nonperformance credit spread was $5 million for the three months ended September 30, 2024 compared to an unfavorable impact of $2 million for the prior year period.

Previous wording

Benefits, claims, losses and settlement expenses increased $4 million, or 1%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting the impact of increased volume in SVAs. This increase was partially offset by a $23 million decrease in expense from market impacts on SVA embedded derivative, net of hedges in place to offset those risks. This decrease was primarily the result of a favorable $107 million change in the market impact on SVA embedded derivative and an unfavorable $81 million change in the market impact on derivatives hedging the SVA embedded derivative. The main market driver contributing to these changes was the equity market impact on the SVA embedded derivative net of the impact on the corresponding hedge assets resulted in a benefit for the three months ended June 30, 2024 compared to an expense in the prior year period.

Current wording

hedges in place to offset those risks. This increase was primarily the result of an unfavorable $683 million change in the market impact on SVA embedded derivative and a favorable $464 million change in the market impact on derivatives hedging the SVA embedded derivative. The main market driver contributing to these changes was the equity market impact on the SVA embedded derivative net of the impact on the corresponding hedge assets resulted in an expense for the three months ended September 30, 2024 compared to a benefit in the prior year period. The increase in expense also reflects the impact of increased volume in SVAs and the impact of higher sales of life contingent payout annuities.

Previous wording

•A $188 million increase in expense from other market impacts on variable annuity guaranteed benefits, net of hedges in place to offset those risks. This increase was the result of an unfavorable $725 million change in the market impact on variable annuity guaranteed benefits reserves, partially offset by a favorable $534 million change in the market impact on derivatives hedging the variable annuity guaranteed benefits. The main market drivers contributing to these changes are summarized below:

Current wording

•A $401 million increase in expense from other market impacts on variable annuity guaranteed benefits, net of hedges in place to offset those risks. This increase was the result of an unfavorable $983 million change in the market impact on variable annuity guaranteed benefits reserves, partially offset by a favorable $595 million change in the market impact on derivatives hedging the variable annuity guaranteed benefits. The main market drivers contributing to these changes are summarized below:

Previous wording

•Interest rate and bond impact on the variable annuity guaranteed benefits liability net of the impact on the corresponding hedge assets resulted in a lower benefit for the three months ended June 30, 2024 compared to the prior year period.

Current wording

•Interest rate and bond impact on the variable annuity guaranteed benefits liability net of the impact on the corresponding hedge assets resulted in an expense for the three months ended September 30, 2024 compared to a benefit in the prior year period.

Previous wording

•Other unhedged items, including the difference between the assumed and actual underlying separate account investment performance, transaction costs and various behavioral items, were a lower net expense for the three months ended June 30, 2024 compared to the prior year period.

Current wording

•Other unhedged items, including the difference between the assumed and actual underlying separate account investment performance, transaction costs and various behavioral items, were a higher net expense for the three months ended September 30, 2024 compared to the prior year period.

Previous wording

General and administrative expense decreased $10 million, or 1%, for the three months ended June 30, 2024 compared to the prior year period primarily due to our continued focus on operational efficiency and effectiveness, partially offset by $24 million of higher severance expense and higher volume related expenses and investments for business growth.

Current wording

General and administrative expense increased $25 million, or 3%, for the three months ended September 30, 2024 compared to the prior year period primarily due to $17 million of higher severance expense, expenses to accelerate our transition to cloud-based technology, higher compensation accruals related to strong performance and the mark-to-market impacts on share-based compensation, partially offset by our continued focus on operational efficiency and effectiveness and a $20 million accrual for a regulatory matter relating to electronic communication recordkeeping requirements in the prior year period.

Previous wording

operating earnings as we measure it for management purposes enhances the understanding of our business by reflecting the underlying performance of our core operations and facilitating a more meaningful trend analysis. See Note 19 to the Consolidated Financial Statements for further information on the presentation of segment results and our definition of adjusted operating earnings.

Current wording

Adjusted operating earnings is the measure of segment profit or loss management uses to evaluate segment performance. Adjusted operating earnings should not be viewed as a substitute for GAAP pretax income. We believe the presentation of segment adjusted operating earnings as we measure it for management purposes enhances the understanding of our business by reflecting the underlying performance of our core operations and facilitating a more meaningful trend analysis. See Note 19 to the Consolidated Financial Statements for further information on the presentation of segment results and our definition of adjusted operating earnings.

Previous wording

Ending wrap account assets increased $13.3 billion, or 3%, to $535.0 billion during the three months ended June 30, 2024 due to net inflows of $7.5 billion and market appreciation of $5.8 billion. Average advisory wrap account assets increased $81.0 billion, or 19%, compared to the prior year period primarily reflecting market appreciation and net inflows.

Current wording

Ending wrap account assets increased $34.1 billion, or 6%, to $569.1 billion during the three months ended September 30, 2024 due to net inflows of $8.0 billion and market appreciation of $26.1 billion. Average advisory wrap account assets increased $86.3 billion, or 19%, compared to the prior year period primarily reflecting market appreciation and net inflows.

Previous wording

Our Advice & Wealth Management segment pretax adjusted operating earnings, which exclude net realized investment gains or losses, increased $91 million, or 12%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting higher average wrap account balances due to market appreciation and net inflows. Pretax adjusted operating margin was 31.1% for the three months ended June 30, 2024 compared to 31.2% for the prior year period.

Current wording

Our Advice & Wealth Management segment pretax adjusted operating earnings, which exclude net realized investment gains or losses, increased $97 million, or 13%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting higher average wrap account balances due to market appreciation and net inflows. Pretax adjusted operating margin was 30.1% for the three months ended September 30, 2024 compared to 30.3% for the prior year period.

Previous wording

Ameriprise Bank is continuing its deposit growth trend, with bank deposit balances increasing $0.5 billion from the prior year period to $21.5 billion. The daily average interest-bearing deposit balance increased to $21.3 billion for the three months ended June 30, 2024 compared to $20.6 billion for the prior year period with the average interest rate paid on deposits increasing to 0.44% for the three months ended June 30, 2024 from 0.38% for the prior year period. Profitability at the bank increased compared to the prior year period primarily reflecting increased interest rates along with the trend in deposit growth. Ameriprise Certificate Company (“ACC”) client deposits increased $0.5 billion from the prior year period to $12.5 billion. After a period of strong growth during a rising interest rate environment, ACC has experienced net outflows during the three months ended June 30, 2024.

Current wording

Ameriprise Bank is continuing its deposit growth trend, with bank deposit balances increasing $0.8 billion from the prior year period to $21.7 billion. The daily average interest-bearing deposit balance increased to $21.5 billion for the three months ended September 30, 2024 compared to $20.9 billion for the prior year period with the average interest rate paid on deposits increasing to 0.46% for the three months ended September 30, 2024 from 0.40% for the prior year period. Profitability at the bank increased compared to the prior year period primarily reflecting growth in deposits. Ameriprise Certificate Company (“ACC”) client deposits decreased $0.6 billion from the prior year period to $12.0 billion. After a period of strong growth during a rising interest rate environment, ACC has experienced net outflows during the three months ended September 30, 2024.

Previous wording

Management and financial advice fees increased $217 million, or 16%, for the three months ended June 30, 2024 compared to the prior year period primarily due to growth in average wrap account assets. Average advisory wrap account assets increased $81.0 billion, or 19%, compared to the prior year period primarily reflecting market appreciation and net inflows.

Current wording

Management and financial advice fees increased $235 million, or 17%, for the three months ended September 30, 2024 compared to the prior year period primarily due to growth in average wrap account assets. Average advisory wrap account assets increased $86.3 billion, or 19%, compared to the prior year period primarily reflecting market appreciation and net inflows.

Previous wording

Distribution fees increased $39 million, or 7%, for the three months ended June 30, 2024 compared to the prior year period reflecting higher transactional activity and market appreciation, partially offset by $44 million of lower fees on off-balance sheet brokerage cash due to lower off-balance sheet brokerage cash balances.

Current wording

Distribution fees increased $62 million, or 11%, for the three months ended September 30, 2024 compared to the prior year period reflecting higher transactional activity and market appreciation, partially offset by $26 million of lower fees on off-balance sheet brokerage cash due to lower off-balance sheet brokerage cash balances and a lower average fee yield.

Previous wording

Net investment income, which excludes net realized investment gains or losses, increased $77 million, or 16%, for the three months ended June 30, 2024 compared to the prior year period primarily due to higher average invested assets due to growth in bank cash deposits and certificate products and the favorable impact of increasing short-term interest rates, including higher investment yields on the investment portfolios supporting the products.

Current wording

Net investment income, which excludes net realized investment gains or losses, increased $37 million, or 7%, for the three months ended September 30, 2024 compared to the prior year period primarily due to higher average invested assets due to growth in bank cash deposits and the favorable impact of increasing investment yields on the investment portfolios supporting the bank cash deposits and certificate products.

Previous wording

(2) Columbia funds are available for purchase by U.S. customers. Out of 89 Columbia funds rated (based on primary share class), 4 received a 5-star Overall Rating and 40 received a 4-star Overall Rating. Out of 139 Threadneedle funds rated (based on highest-rated share class), 20 received a 5-star Overall Rating and 50 received a 4-star Overall Rating. The Overall Morningstar Rating is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics.

Current wording

(2) Columbia funds are available for purchase by U.S. customers. Out of 89 Columbia funds rated (based on primary share class), 4 received a 5-star Overall Rating and 42 received a 4-star Overall Rating. Out of 139 Threadneedle funds rated (based on highest-rated share class), 21 received a 5-star Overall Rating and 51 received a 4-star Overall Rating. The Overall Morningstar Rating is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics.

Previous wording

Our Asset Management segment pretax adjusted operating earnings, which exclude net realized investment gains or losses, increased $56 million, or 35%, for the three months ended June 30, 2024 compared to the prior year period primarily due to equity market appreciation and the positive impact from expense management actions, partially offset by the cumulative impact from net outflows.

Current wording

Our Asset Management segment pretax adjusted operating earnings, which exclude net realized investment gains or losses, increased $46 million, or 23%, for the three months ended September 30, 2024 compared to the prior year period primarily due to equity market appreciation and the positive impact from expense management actions, partially offset by the cumulative impact from net outflows.

Previous wording

Management and financial advice fees increased $39 million, or 6%, for the three months ended June 30, 2024 compared to the prior year period primarily due to higher average equity markets, partially offset by the cumulative impact from net outflows.

Current wording

Management and financial advice fees increased $43 million, or 6%, for the three months ended September 30, 2024 compared to the prior year period primarily due to higher average equity markets, partially offset by the cumulative impact from net outflows.

Previous wording

Our Retirement & Protection Solutions segment pretax adjusted operating earnings, which excludes net realized investment gains or losses (net of the reinsurance accrual), the market impact on variable annuity guaranteed benefits (net of hedges), the market impact on IUL benefits (net of hedges and the reinsurance accrual), mean reversion related impacts, and block transfer reinsurance transaction impacts increased $7 million, or 4%, for the three months ended June 30, 2024 compared to prior year period primarily reflecting higher interest rates and market appreciation, partially offset by higher expenses associated with increased sales.

Current wording

Our Retirement & Protection Solutions segment pretax adjusted operating earnings, which excludes net realized investment gains or losses (net of the reinsurance accrual), the market impact on variable annuity guaranteed benefits (net of hedges), the market impact on IUL benefits (net of hedges and the reinsurance accrual), mean reversion related impacts, and block transfer reinsurance transaction impacts increased $18 million, or 18%, for the three months ended September 30, 2024 compared to prior year period primarily reflecting higher investment portfolio yields and market appreciation, partially offset by higher expenses associated with increased sales.

Previous wording

Variable annuity account balances increased 8% to $84.5 billion as of June 30, 2024 compared to the prior year period due to market appreciation, partially offset by net outflows of $3.2 billion. Variable annuity sales increased 45% compared to the prior year period reflecting an increase in sales of SVAs. Account values with living benefit riders declined to 52% as of June 30, 2024 compared to 56% a year ago reflecting our actions to optimize our business mix. This trend is expected to continue and meaningfully shift the mix of business away from products with living benefit guarantees over time.

Current wording

Variable annuity account balances increased 17% to $87.7 billion as of September 30, 2024 compared to the prior year period due to market appreciation, partially offset by net outflows of $3.5 billion. Variable annuity sales increased 13% compared to the prior year period primarily reflecting an increase in sales of SVAs. Account values with living benefit riders declined to 51% as of September 30, 2024 compared to 55% a year ago reflecting our actions to optimize our business mix. This trend is expected to continue and meaningfully shift the mix of business away from products with living benefit guarantees over time.

Previous wording

Net investment income, which excludes net realized investment gains or losses, increased $63 million, or 31%, for the three months ended June 30, 2024 compared to the prior year period primarily due to higher interest rates, investment portfolio repositioning resulting in higher yields and increased SVA balances.

Current wording

Net investment income, which excludes net realized investment gains or losses, increased $66 million, or 31%, for the three months ended September 30, 2024 compared to the prior year period primarily due to higher investment portfolio yields from investment portfolio repositioning and increased SVA balances.

Previous wording

Benefits, claims, losses and settlement expenses, which exclude the market impact on structured variable annuities indexed account embedded derivative (net of hedges) and mean reversion related impacts, increased $38 million, or 20%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting increased volume in SVAs.

Current wording

Benefits, claims, losses and settlement expenses, which exclude the market impact on structured variable annuities indexed account embedded derivative (net of hedges) and mean reversion related impacts, increased $85 million, or 51%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting increased volume in SVAs.

Previous wording

Our Corporate & Other segment pretax adjusted operating loss excludes net realized investment gains or losses, the market impact on fixed annuity benefits (net of hedges), the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments, block transfer reinsurance transaction impact, gain or loss on disposal of a business that is not considered discontinued operations, integration and restructuring charges, and the impact of consolidating CIEs. Our Corporate & Other segment pretax adjusted operating loss increased $59 million for the three months ended June 30, 2024 compared to the prior year period.

Current wording

Our Corporate & Other segment pretax adjusted operating loss excludes net realized investment gains or losses, the market impact on fixed annuity benefits (net of hedges), the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments, block transfer reinsurance transaction impact, gain or loss on disposal of a business that is not considered discontinued operations, integration and restructuring charges, and the impact of consolidating CIEs. Our Corporate & Other segment pretax adjusted operating loss increased $71 million for the three months ended September 30, 2024 compared to the prior year period.

Previous wording

LTC insurance had a pretax adjusted operating earnings of $12 million for the three months ended June 30, 2024 compared to pretax adjusted operating earnings of $1 million for the prior year period primarily reflecting improved claims experience and the benefit of investment portfolio repositioning and higher interest rates on cash positions compared to the prior year period.

Current wording

LTC insurance had a pretax adjusted operating earnings of $9 million for the three months ended September 30, 2024 compared to pretax adjusted operating earnings of $10 million for the prior year period primarily reflecting an unfavorable unlocking impact in the current period, along with a favorable impact in the prior year period, offset by improved claims experience and the benefit of investment portfolio repositioning and higher interest rates on cash positions compared to the prior year period.

Previous wording

The FA business had a pretax adjusted operating loss of $8 million for the three months ended June 30, 2024 compared to a pretax adjusted operating loss of $5 million for the prior year period. Fixed deferred annuity account balances declined 11% to $5.9 billion as of June 30, 2024 compared to the prior year period as policies continue to lapse and we previously discontinued new sales of fixed deferred annuities.

Current wording

The FA business had a pretax adjusted operating loss of $7 million for the three months ended September 30, 2024 compared to a pretax adjusted operating loss of $8 million for the prior year period. Fixed deferred annuity account balances declined 11% to $5.8 billion as of September 30, 2024 compared to the prior year period as policies continue to lapse and we previously discontinued new sales of fixed deferred annuities.

Previous wording

Net investment income, which excludes net realized investment gains or losses, the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments, block transfer reinsurance transaction impacts, integration and restructuring charges, and the impact of consolidating CIEs, decreased $29 million, or 38%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting a $12 million benefit in our affordable housing partnerships in the prior year period, as well as adjustments and updates made in the fourth quarter of 2023 to the allocation of investment income across business segments that reflected increased market volatility and the interest rate environment.

Current wording

Net investment income, which excludes net realized investment gains or losses, the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments, block transfer reinsurance transaction impacts, integration and restructuring charges, and the impact of consolidating CIEs, decreased $18 million, or 25%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting adjustments and updates made in the fourth quarter of 2023 to the allocation of investment income across business segments that reflected increased market volatility and the interest rate environment.

Previous wording

General and administrative expense increased $35 million, or 58%, for the three months ended June 30, 2024 compared to the prior year period primarily reflecting $24 million of higher severance expenses associated with our initiatives to enhance operational efficiency and effectiveness.

Current wording

General and administrative expense increased $45 million, or 64%, for the three months ended September 30, 2024 compared to the prior year period primarily reflecting $17 million of higher severance expenses associated with our initiatives to enhance operational efficiency and effectiveness, as well as $22 million of expenses to accelerate our transition to cloud-based technology, higher compensation accruals related to strong performance and the mark-to-market impacts on share-based compensation.

Previous wording

•A favorable impact from higher average equity markets compared to the prior year period. Our average WEI, which is a proxy for equity movements on AUM, increased 21% in the six months ended June 30, 2024 compared to the prior year period. The average S&P 500 index was 25% higher in the six months ended June 30, 2024 compared to the prior year period.

Current wording

•A favorable impact from higher average equity markets compared to the prior year period. Our average WEI, which is a proxy for equity movements on AUM, increased 21% in the nine months ended September 30, 2024 compared to the prior year period. The average S&P 500 index was 25% higher in the nine months ended September 30, 2024 compared to the prior year period.